Proposed changes to Australia’s Migration Program

On Thursday, 27 April 2023, Minister for Home Affairs, the Hon. Clare O’Neil MP, addressed the National Press Club on Australia’s Migration System following the release of the Review of the Migration System -Report of the Expert Panel.

She acknowledged that migration “helped deliver the longest period of continuous economic growth in recorded history, anywhere in the world” and the need to be “strategic”, “decisive”, and “purposeful” at a time when we “confront the most challenging geopolitical circumstances since the 1940s”.

This Review outlines a series of directions and options for the future of Australia’s migration system for the Government’s consideration. It includes 38 wide-ranging possible reform directions, including proposed changes to the employer-sponsored temporary and permanent entry Visa programs.

Minister O’Neil said the Review was a “big opportunity” for the Government to implement its reform agenda to achieve a migration system that will be in our national interest.

The key highlights which come into effect on 1 July 2023 include:

Temporary skilled migration income threshold will increase from $53,900 to $70,000 in addition to superannuation
All temporary skilled workers will have a pathway to permanent residency.

In the words of the Hon, Clare O’Neil, “this does not mean more people. It means a group of temporary workers who had been denied even the opportunity to apply for permanent residency will be able to do so.”

The objectives of the migration system reforms

For many years, I’ve been providing commentary on Australia’s complex migration program. The objectives of the program are complex and at this stage it is unclear as to the full scope and detail of the proposed changes.

In commissioning the Review, Minister O’Neil stated that the aim of migration reform was to support Australia’s needs now and into the future.

The Expert Panel identified five objectives on which to build the migration system reforms:

Building Australia’s prosperity by lifting productivity, meeting labour supply needs and by supporting exports
Enabling a fair labour market, including by complementing the jobs, wages and conditions of domestic workers
Building a community of Australians
Protecting Australia’s interests in the world.
Providing a fast, efficient and fair system.

Taken together, these objectives ensure the migration system will operate in Australia’s national interest. The objectives recognise the centrality of migration to Australia’s economic success, geopolitical position and social fabric.

Proposed reform directions

The Expert Panel reform directions for Government to consider include:

Reform directions:	Measures supporting possible reform directions:
Redefine how Australia determines the size and composition of the migration program	Move to planning migration over a long-term time horizon (e.g. 10 years).
	Plan migration based on net overseas migration (which accounts for both permanent and temporary residents), rather than simply relying on permanent migration caps.
	Work across government – and with states and territories – to consider how best migration can help meet place-based objectives, particularly in regional Australia.
Better target permanent skilled visas to maximise economic outcomes and remain internationally competitive	Revisit the allocation of places across the permanent skilled program. In particular, reconsider the size and role of the Business Innovation and Investment Program (BIIP), noting more positive outcomes from the Significant Investor Visa. Consider how to manage the allocation of places to state and territory nominated and regional visas, including possible consolidation of these programs.
	Recalibrate the points test to select migrants with high human capital who will make the greatest long term economic contribution.
	Consider changes to the existing Global Talent visa to improve clarity in the selection criteria and remove the need for a nomination.
Be led by the evidence, in temporary skilled migration	Rely on the expertise of Jobs and Skills Australia to identify labour needs and market salary rates and provide deep insights and input in a way that links migration with skills and training.
	Remove the requirement for labour market testing.
	Renew and strengthen the role of the Ministerial Advisory Council on Skilled Migration (MACSM) as a tripartite advisory body.
	Draw on advice of the Jobs and Skills Australia to further inform this tripartite approach.
	Increase the Temporary Skilled Migration Income Threshold (TSMIT), index it to the Wage Price Index, and consider the adoption of age adjusted thresholds
Adopt principles and guardrails to manage risk in temporary skilled migration	Adopt risk-based regulation of temporary labour migration, with three tiers: a ‘light touch’ high salary cohort; a ‘mid-level cohort’ (above the TSMIT, below the high-salary threshold of cohort 1); and subject to further consideration across government, a lower wage cohort in sectors experiencing persistent shortages and who are most at risk of exploitation and displacing Australian workers with similar skills. Regulatory effort should be highest for cohort 3 and lowest for cohort 1.
	Allow temporary migrant workers to move from their current employment to find work with another employer within the same sector or job family. Migrants could have up to 6 months to find new employment.
	Require all employers of temporary visa holders to register that employment through a light-touch process; those with a history of serious workplace breaches would be deregistered and ineligible to employ visa holders.
	Require employer fees and charges to be paid monthly, rather than up-front, to facilitate mobility between employers and increase access for small business by reducing up-front costs.
	Provide migrant workers with targeted training on workplace laws and conditions based on the Pacific Australia Labour Mobility (PALM) scheme model.
	Improve post-arrival monitoring and compliance including through coordination with the tax system, using tax file numbers (TFN) and single-touch payroll.
Resolve and avoid ‘permanently temporary’ migration	Review the drivers that have created a continuing ‘permanently temporary’ cohort with a view to ensuring future cohorts do not emerge.
Restore the Working Holiday Maker program to its original intention	Ensure the primary focus of the Working Holiday Maker program is cultural exchange and does not operate to tie migration outcomes to the performance of work. Subject to Australia’s obligations under trade and other international agreements, consider limiting Working Holiday Maker visas to one year.

Need help navigating Australia’s complex migration system?

In our submission to the Expert Panel in December 2022, our Migration Services team made 33 recommendations and argued for a simplified and streamlined migration system, detailing the need to address the impact of skilled workforce shortages on Australia’s economic recovery, which you can read here.

If you or your organisation requires support to navigate Australia’s complex migration system, contact the BDO Migration Services team today. Or you can contact Maria Jockel, Global and National Immigration Leader, Legal Principal and Accredited Specialist in Immigration Law; or Rebecca Thomson, Principal Lawyer, BDO Migration Services, directly.

More information on the changes can be found on the Department of Home Affairs website.

Disclaimer: This information is provided as a guide only and it has been written in general terms and should be seen as a broad guidance only. This information cannot be relied upon to cover specific situations and you should not act, or refrain from acting, upon the information without obtaining specific professional advice. ©April 2023 BDO Migration Services. All rights reserved.